(CN) – Eminem’s record label failed to convince the Supreme Court on Monday to review a ruling that granted producers affiliated with the rapper significantly higher royalties on songs and albums downloaded from Apple’s iTunes store.
The 9th Circuit ruled in September that Universal Music Group’s Aftermath Records had underpaid Em2M LLC and FBT Productions in royalties on Eminem’s downloaded music.
FBT had signed Marshall Mathers III, professionally known as Eminem, in 1995 and transferred its exclusive rights to his recordings to Aftermath three years later.
Under the transfer agreement, FBT would receive royalties of 12 to 20 percent on the adjusted retail price of all full records sold and 50 percent on licensed master recordings.
The production companies sued the label in 2008 when it learned that Aftermath had been calculating royalties for downloaded music by treating it as “records sold” instead of licensed music.
Aftermath was awarded more than $2.4 million in attorney’s fees after a jury took its side at trial. But the federal appeals panel in Pasadena reversed and vacated the attorneys’ fees award, concluding that FBT is entitled to the higher royalty rate.
A month later, the 9th Circuit declined to grant Aftermath a rehearing.
With the implicit affirmation by the Supreme Court, the ruling could benefit older artists who have been getting a fraction of download income based on contracts they entered long before current technology.
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